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FSIC III Reports Operating Results for 2Q15

FS Investment Corporation III, a business development company focused on providing customized credit solutions to private middle market U.S. companies, released its operating results for the quarter ending June 30, 2015.

“During the quarter, FSIC III’s focus on senior secured, floating rate investments and the strength of its direct lending platform helped deliver strong distributions to our stockholders,” commented Michael C. Forman, chairman and chief executive officer of FSIC III. “Building on the success of its predecessor funds, FS Investment Corporation and FS Investment Corporation II, FSIC III has quickly grown its allocation to direct originations by leveraging the combined purchasing power across all of Franklin Square’s business development companies.” 

Below are the financial highlights during the quarter ending June 30, 2015.

• Generated net investment income of $0.15 per share, compared to $0.10 per share year-over-year

• Generated net earnings of $0.16 per share, compared to $0.29 per share for the quarter compared to one year ago

• Generated a net realized and unrealized gain of $0.01 per share, compared to $0.19 per share for the quarter ended June 30, 2014

• Paid regular cash distributions to stockholders totaling approximately $0.18 per share

• Committed approximately $395.1 million to direct originations, nearly all of which were in senior secured loans (first and second lien)

• For the six months ended June 30, 2015, FSIC III generated a total return based on net asset value of approximately 5.79 percent

Portfolio highlights as of June 30, 2015

• The fair value of FSIC III’s investments was approximately $1.5 billion

• FSIC III’s portfolio consisted of investments in 119 portfolio companies

• Core investment strategies represented 81 percent of the portfolio by fair value (44 percent in direct originations and 37 percent in opportunistic investments). Broadly syndicated/other investments represented 19 percent of the portfolio by fair value

• Gross portfolio yield prior to leverage (based on amortized cost and excluding non-income producing assets) was 10.3 percent, compared to 10.7 percent as of March 31, 2015

Since commencing investment operations on April 2, 2014 and through July 28, 2015, FS Investment Corporation III raised approximately $1.8 billion in total gross proceeds from the issuance of shares of its common stock, including approximately $15.2 million raised from investors affiliated with its investment adviser, FSIC III Advisor, LLC, including certain members of FSIC III’s board of directors, and its investment sub-adviser, GSO / Blackstone Debt Funds Management LLC, and shares issued through its distribution reinvestment plan.

FS Investment Corporation III is a publicly registered, non-traded business development company sponsored by Franklin Square Capital Partners. The firm focuses primarily on investing in the debt securities of private companies throughout the United States, with the investment objectives of generating current income and, to a lesser extent, long-term capital appreciation for its investors. FS Investment Corporation III is advised by FSIC III Advisor, an affiliate of Franklin Square, and is sub-advised by GSO / Blackstone Debt Funds Management LLC, an affiliate of GSO Capital Partners LP. GSO, with approximately $81 billion in assets under management as of June 30, 2015, is the credit platform of Blackstone.

Founded in Philadelphia in 2007, Franklin Square managed approximately $16.8 billion in assets and is the largest manager of business development company assets with $15.4 billion under management, as of June 30, 2015. Franklin Square distributes its non-traded funds through its affiliated broker-dealer, FS2 Capital Partners, LLC.

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